Sunday, March 30, 2008

Painted into a corner over the gasoline tax issue, Prime Minister Fukuda attempted to undercut Ozawa Ichiro in an interview on NHK Sunday, suggesting that the impetus for a grand coalition came from Mr. Ozawa. The facts of the negotiations surrounding an LDP-DPJ grand coalition — especially Watanabe Tsuneo's role in it — may never be known, but the significance of Mr. Fukuda's mentioning this now has everything to do with undermining Mr. Ozawa's position at the head of the party.

The grand coalition fiasco, after all, was the end of the DPJ's love affair with Mr. Ozawa, insofar as it was a love affair. Recalling the fiasco can only undercut Mr. Ozawa's relationship with his own party.

But Mr. Fukuda must be encouraged by the results of an Asahi poll that shows that the public is favorable towards his latest compromise solution to the gasoline tax dispute. In a phone survey of approximately 650 respondents from across Japan, 58% approved of delaying the transfer of the road construction fund into the general fund until fiscal 2009, while only 24% opposed. At the same time — and more than slightly contradictorily — only 31% approve of the plan to retain to the temporary gasoline tax and use the revenue for road construction in fiscal 2008 (55% opposed). Respondents were pleased at the prospect of a drop in gasoline tax in April by a margin of 72% to 12%, but that did not translate into more support for the DPJ. Asked whether they approve of the DPJ's position, 40% approved, 44% disapproved. Less significantly, the DPJ saw a one-point drop in its support rate to 20%, compared with the LDP's two-point increase to 31%. The LDP, however, should not be too encouraged by this poll: respondents overwhelmingly blamed both parties for the gasoline tax dispute, and when asked about the BOJ dispute, respondents approved of neither the LDP's nor the DPJ's approach to the succession battle.

There is now the open question of whether Mr. Fukuda truly has the support of the LDP in pushing for a compromise that includes provisions for the demise of the special road construction fund, whatever the time line. The opposition parties consulted with Chief Cabinet Secretary Machimura on Friday on this question, who replied, "I think that individual members hold various opinions, but I think that since it is the prime minister's decision and leadership, understanding will be reached." Mr. Fukuda indicated Friday in response to a question in the HC Budget Committee that he consulted beforehand with the ministers of finance, transportation, and internal affairs, but not with the whole cabinet.

Hence Kono Taro felt compelled to describe Thursday's about-face as a "palace coup," with Mr. Kono and his comrades, who believe in the need to transfer special road construction funds into the general fund and are prepared to vote against the prevailing measure if it comes before the HR a second time, "transformed in a stroke from opposition forces to imperial guards" as Mr. Fukuda wholly embraced their ideas.

The idea that road tribe and its allies in prefectural and local governments will be cowed by Mr. Fukuda's sudden shift is unrealistic. Confident that they had won the argument — convinced that the government, having passed the bill, would simply wait for sixty days to elapse and then pass the bill again — there is no reason to think that the advocates of business as usual will be silenced. As Mr. Kono wrote, "Within the party there are still various voices. Whether or not the LDP will completely cut longstanding ties of obligation, whether or not it can do the ordinary things — there will not be a second chance."

The just-passed compromise bill that extends to the end of May various taxes in the special measures bill on taxation except the temporary tax means that the price of a liter of gasoline is set to drop from Tuesday. It also means that both Mr. Fukuda and Mr. Ozawa will now be under tremendous pressure that will grow by the day. Mr. Fukuda will be pressured by the reformists to hold the new line, even as the road tribe and its allies pressure Mr. Fukuda to back down from his newly announced plan. The prime minister will also face some pressure from the DPJ, which has promised once again to pass a non-binding censure motion against the prime minister if the HR re-passes the tax bill at the end of the sixty-day period. (Mind you, I don't take this threat particularly seriously — and I'm sure neither does Mr. Fukuda — because the prime minister is free to ignore the censure motion and carry on as if nothing happened. But it's worth mentioning...)

Mr. Ozawa, meanwhile, will be under pressure from opponents within his own party not to cave, lest his position as party leader become forfeit, just as the DPJ as a whole will be under pressure from the media (AKA "public opinion) and the government to compromise. Every day that passes will help the DPJ, as consumers become accustomed to paying less for gas and less willing to countenance a tax hike (and worried LDP backbenchers less willing to risk their seats to see the higher rate restored in a month's time).

The newly passed agreement may momentarily ease the sense of crisis, but not for long. The LDP and the DPJ are in the midst of a battle with significant consequences for the future of the Japanese political system.

Saturday, March 29, 2008

For the first time since it was created in 1978, the "sympathy budget" by which Japan subsidizes the presence of US forces in Japan will not be passed before the end of the fiscal year, due to demands from the DPJ for more thorough deliberation. The bill, a three-year extension of the current host-nation support arrangement, will pass the HR at the beginning of April, but since the DPJ is expected to use HC deliberations to question the bill, it will most likely not take effect until the beginning of May.

The material impact of this delay is negligible. The US will have to take responsibility for paying civilian laborers and utility bills. The relocation of US aerial exercises from Okinawa to the mainland, scheduled to be paid for by Japan, will likely be delayed until May.

The political significance of the delay, however, is enormous. I wrote last week that the Japanese contribution to construction on Guam could be a cause for delay in the project as a result of the DPJ's desire for oversight. Consider this a preview. The DPJ has made no secret of its eagerness to scrutinize how every taxpayer yen is spent in relation to the alliance — and it will take every opportunity to do so. Every bill related to the alliance that comes before the Diet will be an opportunity for the DPJ to search for and expose fraud, waste, and abuse.

The government is worried about the impact DPJ scrutiny will have on the alliance. Foreign Minister Komura said, "I have no doubt that US confidence (in Japan) is diminishing. I am worried that the US-Japan alliance's deterrent power is weakening."

On the contrary, I hope that DPJ oversight is the beginning of a more robust and equitable alliance relationship, one in which Japan raises its voice in alliance deliberations. In this sense, last year's fight over the MSDF refueling mission in the Indian Ocean was the DPJ's first broadside in a long-term struggle to introduce accountability into the alliance. For too long the relationship has gone unquestioned outside the editorial pages of Akahata. But questions need to be asked. Who owes who what? What are the obligations of each ally? Should this arrangement change? Hopefully DPJ members will raise these questions in the next month of HC deliberations on this bill.

Thursday, March 27, 2008

Tom Conley and Michael Heazle, writing in The Australian, look back to the 1990s to criticize Prime Minister Kevin Rudd's travel itinerary.

In addition to haranguing Japan on whaling, they argue

Rudd has added insult to injury by snubbing Japan on his coming world tour. The Prime Minister seemingly can find the time to traverse the entire globe but not to visit Japan. The cold-shoulder is made more disturbing for Tokyo by the inevitable comparison it creates with Australia's relationship with Beijing and the constant reporting of Sinophile Rudd as China's new golden child. It is certainly no secret that early visits are symbolically important, since they give a strong indication of who and what the new leader considers to be important. In the arena of foreign relations and diplomacy, impressions matter and Australia has had few prime ministers more aware of this basic fact. All of which makes Rudd's Japan passing even more curious.

They further argue that Mr. Rudd's focus on China is misguided due to Japan's commitment sound Australia-Japan relations and its enduring significance as a regional economic power.

Back when Mr. Rudd followed Mr. Fukuda into power last year, I expressed my hopes that "with Fukuda Yasuo replacing Mr. Abe, and the Mandarin-speaking Mr. Rudd replacing Mr. Howard, the 'deputy sheriff,' the 'quad' may be no more. Both Mr. Fukuda and Mr. Rudd seem to believe that their power is best spent promoting cooperation in Asia, not deepening security cooperation among democracies conveniently located on all sides of China."

I still think that these leaders' thinking on Asia policy is the way of the future, but I was clearly mistaken in expecting that Australia and Japan might begin articulating a new approach in the immediate future. The fault is not Mr. Rudd's alone. What would a visit to Tokyo now accomplish? The Fukuda government, completely distracted by mounting domestic problems and possibly on its last legs, has made little progress articulating a new Asia policy or a new grand strategy in which to embed it.

So yes, Mr. Rudd should have made a stop — and should put some effort into thinking about both countries can balance their China ties with their links to the US. But he can't be blamed too much for passing up a photo-op with an enfeebled Mr. Fukuda.

Not surprisingly, DPJ Secretary-General Hatoyama Yukio signaled that the DPJ will not accept Mr. Fukuda's latest plea. LDP Secretary-General Ibuki Bunmei and Komeito Secretary-General Kitagawa Kazuo are reportedly working on an emergency one-month extension to avert "chaos," i.e. to not give the Japanese people a one-month tax cut that they might not want to see reversed in a month.

More interesting, however, is the impact of Mr. Fukuda's plea within the LDP. The road tribe is of course, apoplectic over his compromise; the Koizumians are pleased that the prime minister is coming around to one of the maestro's cherished positions. Considering that even some ostensible "reformists" have been spinning the road construction plans as beneficial for rural areas (as opposed to construction companies and the politicians they back), this last-ditch effort may well throw the party into complete disarray, more than it already is. Mr. Fukuda, already struggling to impose discipline and order on the LDP, may find himself completely friendless after this gambit. Will someone dare to act in the coming weeks to force him out? Will Mr. Mori withdraw his support and suggest that Mr. Fukuda ask for indefinite sick leave?

The debate in the coming weeks over whether to pass the tax bill at the end of next month over the objections of the HC, the opposition, and much of the Japanese public could well be the trigger for a realignment, with Mr. Fukuda's premiership consumed in the process.

Tuesday, March 25, 2008

In Japanese postwar political history, the phrase "low posture" — 低姿勢, teishisei — is most associated with Prime Minister Ikeda Hayato (1960-1964). No mere slogan, the phrase signaled an end to the Kishi era, which ended in violence in the streets of Tokyo.

The Ikeda era would be one of "tolerance and patience," of working with the opposition to formulate policy.

The phrase subsequently became associated with the LDP mainstream as embodied by the Kochikai — indeed, it became part of the furniture of LDP rule under the 1955 system. Even Fukuda Takeo, the current prime minister's father, who was associated with the anti-mainstream Kishi faction, declared his commitment to a "low posture" in Diet proceedings in August 1977: "As for Diet management, for my government and the LDP, in facing other parties we must have a low posture...So, concerning important policy, before the government decides we want to ask for everyone's opinions as much as possible."

Of course, the flip side of the declared commitment to a low posture was the inevitable criticism from opposition parties when the government reportedly failed to adhere to this stance. Prime Minister Ikeda was not immune, as in the later years of his government, Socialist Diet members regularly claimed that his low posture was just a political maneuver to placate the public before elections.

Fukuda Yasuo is but the latest adherent of the LDP's low posture school to serve as prime minister — and according to Sankei, the Fukuda cabinet's troubles illustrate the "bankruptcy" of the low posture and the need for a firmer line with the DPJ. In an article that sounds suspiciously editorial-like, the newspaper suggests that there are "omens" that Mr. Fukuda is set to abandon the cooperative posture he adopted upon taking office.

It seems that Mr. Fukuda's — and the LDP's — problem is that its posture hasn't nearly been low enough. While the government has been sparing in its use of its HR supermajority, it has acted as if the supermajority gives it the ability to dictate terms to the DPJ and the HC. Prior consultation? Genuine deference to the DPJ's positions? The government has preferred to submit its proposals and then attempt to hammer out a compromise after the fact. MTC ably demonstrates how the government's poor time management is indicative of the Fukuda government's attitude towards the DPJ. In the months since being denied its grand coalition with the DPJ, the LDP has preferred to gripe about the DPJ's failure to be a "responsible" opposition party than to forge realistic and working cooperation as necessary with the HC's largest party. If any government deserves to be criticized for announcing a "low posture" as a political ploy, the Fukuda government is it.

The government still has not come to terms with the idea that unless it wants to govern solely by Article 59 and leave important posts unfilled, it has no choice but to work with the DPJ. And so the BOJ governorship is occupied by an interim governor (has the sky fallen yet?) and the Japanese people are about to get a nice tax cut come April 1.

According to Mainichi, the group — which was formed in January 2007 under Mr. Abe — envisions the implementation of drastic reorganization of the relationship between central and regional governments by 2018, but it also announced that it won't have a final report ready for another two years. One sticking point is how the prefectures are to be reorganized. Not surprisingly, drastically redrawing the geographic boundaries of Japan's regional governments draws opposition from existing prefectural governments and bureaucrats in the central governments. Even the LDP and the government have differing ideas about a reorganization, with the LDP's Headquarters for the Promotion of Prefectural Integration calling for consolidating prefectural and local governments into 10 states and 700-1000 municipalities.

And the government's ministries and agencies are, of course, adamantly opposed to a transfer of authority to regional governments.

It's probably safe to say that without the bureaucracy's approval, regional decentralization will not happen.

As I've noted previously, decentralization could have considerable benefits for Japanese governance by bringing government closer to the people and making it more transparent. But there's a reason why this kind of change happens rarely, if at all. (The last major reorganization of regional governments, of course, was in the early years of the Meiji Restoration.) It is easy for politicians and business leaders to appeal to the example of the Meiji Restoration — not surprisingly, this interim report does — but it is considerably more difficult for political leaders to overcome institutional obstacles and implement Meiji-style reforms in the present political environment.

Who can overcome the opposition that proposals like regional decentralization necessarily attract? (And is there actually a majority in favor of sweeping reform? People may be unhappy with the current political situation, but that does not necessarily translate into support for broad change.)

At a press conference Monday, Prime Minister Fukuda expressed his anger at the DPJ's rejection of the government's efforts to pass compromise legislation on taxation.

"[The DPJ] has an attitude of entirely not deliberating on the budget-related tax bill. What can the Diet do about this? Speaking honestly, this is incomprehensible."

Mr. Fukuda and the LDP executive has reportedly been leaning on Kono Yohei, HR speaker, to forge yet another compromise with the DPJ to forestall the "chaos" anticipated by some LDP members if the tax bill doesn't pass by the end of the month. (Jun Okumura argues here that the chaos might not be nearly as bad as suggested.)

Perhaps the impression that Mr. Fukuda is not worried about his situation — suggested here — is mistaken. With his government's six-month anniversary approaching Wednesday, his government is in trouble. Low popularity may be the least of his troubles. Most worrying is that Mr. Fukuda has had little success quelling internal conflict within the LDP, which will make it difficult for him to extricate himself from his situation. One conflict, of course, is the rift between the conservatives centered around the True Conservative Policy Research Group and risk-averse party elders, who are desperate to preserve unity; another rift, discussed in this article in Sentaku magazine, is between growth-firsters (led by Nakagawa Hidenao and Takenaka Heizo) and financial reconstructionists (led by Yosano Kaoru and Tanigaki Sadakazu). Keeping each of these groups content is a difficult, if not impossible task.

Who will Mr. Fukuda disappoint in the war over the tax bill? If no compromise emerges in the next week, will the government bow to the inevitable and not override the HC at the end of April? Mainichi suggests in this article that Mr. Nakagawa believes the government should not use the supermajority. Of course, if Mr. Fukuda lets the temporary tax lapse, he risks enraging his financial reconstructionist supporters, like Mr. Tanigaki.

The demise of the Fukuda cabinet is underway, although it will take months to play out. The timing will depend on who the government disappoints most over the next month.

Saturday, March 22, 2008

Most of the concerns about the lack of progress in implementing the 2006 US-Japan realignment agreement have focused on political troubles in Japan, as Tokyo has struggled to get local governments involved in the relocation of US forces in Japan to accept the terms of the 2006 agreement. With the change of government in Iwakuni removing an obstacle (and, in accordance with Tokyo's tit-for-tat tactics, resulting in the restoration of frozen subsidies to Iwakuni) and the environmental survey at Camp Schwab in Okinawa proceeding, albeit irregularly, attention is now shifting to Guam, the receiving end of the realignment agreement.

A look at Guam shows that even if the Japanese side of the process was proceeding smoothly, the US still has substantial work to do to prepare Guam to host an additional 40,000 US service personnel, dependents, and contractors, a substantial increase from the 13,000 who are there presently (in addition to 173,000 civilians).

The stakes of the Guam buildup are enormous. For Guam's citizens, the expanded military presence will mean a massive boon to the territory's economy. For the US military, Guam will become an important hub for the Navy, Air Force, and Marines, a transformation already underway as far as the Air Force is concerned. Contractors are undoubtedly excited about the projected $13 billion price tag, a number that will likely increase. But preparing the island for the massive influx of US forces will require cooperation among the federal government, the Japanese government, Guam's government, and the US military — and for the moment, cooperation has been elusive, raising questions about whether the project will begin in 2010 as scheduled.

The Hill, a Capitol Hill publication, highlighted an additional problem: Madeline Bordallo, Guam's congressional delegate, is struggling to build a coalition that will support funding for the project. The article notes that Ms. Bordallo is having a particularly hard time gaining support in the Senate, where Guam has no representation. (Another problem is that many lawmakers know nothing about Guam, beginning with its location.)

Federal funding is indispensable, because this project is not just a matter of military bases. The influx of personnel will entail major improvements in the island's infrastructure, which is already stressed due to its position in Typhoon alley and a surprisingly costly snake problem. It will entail new homes and schools. (The Washington Post reviewed the infrastructure and funding problems in an article last month.)

What does this mean for the Japanese government? According to the 2006 agreement, of course, Japan is obligated to pay $6 billion towards the transfer of Marines to Guam, meaning that Tokyo will be paying for this massive construction project. Undoubtedly Washington is eager to receive Japanese funds. But given the coordination problems that have hampered the process to date, and the oversight problems that will undoubtedly dog the process in the future, is Japanese money worth what the Japanese contribution will cost in terms of efficiency? The debate in the Diet last year over Japanese fuel contributions that may have been diverted to the Iraqi campaign was in a sense a preview for the debate that will surround the use of Japanese funds in Guam. While most of the contribution will be in the form of loans from the Japan Bank of International Cooperation (JBIC), the GOJ's $2.8 billion direct contribution will come under intense scrutiny from the opposition — and if the DPJ and other opposition parties manage to form a government, the 2007 law authorizing the use of Japanese funds could be repealed (if the DPJ's opposition to the law's passage is any indication).

Admittedly, though, the efficiency gains for releasing Japan from its obligations are the least important argument in support of this idea, because as noted above the process is inefficient as is.

I think that the next president should offer to renegotiate the 2006 agreement and to release Japan from its financial contribution as a gesture of goodwill and a signal that the next administration will mark the beginning of a new, more equitable era in the alliance. For the Bush administration, a closer alliance has meant an alliance in which Tokyo is more subservient to Washington. The next administration can break from the past by recognizing Japan's financial difficulties and freeing Tokyo from having to pay for construction on Guam. While the Japanese financial contribution will be missed, particularly as the price tag grows, the change in tone that would result from renegotiation would yield long-term benefits from US-Japan cooperation (instead of the ill will associated with the current arrangement).

Meanwhile, the next president should make preparations on Guam a priority for US Asia policy and use presidential power to solve the coordination problems currently hampering the construction project, pressuring Congress to appropriate funds for the construction in order to expedite the process. (And the US might as well finance it from deficit spending and let China pay for the construction.)

"It's strange," the newspaper writes, "that the prime minister's sense of crisis appears to be diluted," considering that the BOJ vacancy and the uncertain prospects for a compromise with the DPJ over taxes and road construction could spell the end of his premiership.

Yamamoto Ichita, LDP HC member, suggests that concerns about the durability of the Fukuda cabinet may be overblown because all Diet members are motivated by what he calls "election avoidance syndrome." His HR colleagues, he suggests, are terrified for their election prospects and will therefore be willing to bend considerably to delay a general election. He suggests that some younger LDP members will vote against renewing the gasoline tax if the tax is canceled and then comes up for a vote in the HR again. In a postscript, Mr. Yamamoto addresses the idea that the LDP might dump Mr. Fukuda prematurely: "With the Fukuda cabinet's approval rating dropping, 'Dump Fukuda' voices are strengthening within the party?!?...this case is inconsistent with 'election avoidance syndrome.'" The LDP will stick with Mr. Fukuda, he argues, because dumping him will raise the chances of an early election. (Then again, his logic that another leadership change will mean pressure to go to the people for a mandate is shaky, if only because the baton was passed from Mr. Abe to Mr. Fukuda without the people being consulted.)

Perhaps Mr. Fukuda's Thursday meeting with Nakagawa Shoichi and Yosano Kaoru, who represent two blocs that could potentially challenge Mr. Fukuda's leadership, suggests that his hold on the party, however tenuous, remains secure. (In other words, both men and their comrades are slight content to let Mr. Fukuda suffer the slings and arrows of the divided Diet.)

Mr. Yamamoto may be right: Mr. Fukuda could have nothing to worry about by virtue of being in possession of the leadership. But to echo a concern raised by the Hokkaido Shimbun, how long can he go without articulating a reform agenda? And for how much longer can he count on both the conservatives and the reformists to support his government?

Foreign policy could prove Mr. Fukuda's undoing. Sankei reported that the subject of the True Conservative Policy Study Group's meeting this week was China policy, which turned into criticism of Mr. Fukuda's reconciliatory approach. A muddled approach to Tibet could give the conservatives an opening, if they choose to exploit it.

The daunting political situation is probably enough to secure Mr. Fukuda's position through the July G8 summit — I still think that prospective successors would prefer that Mr. Fukuda take a thorny issue or two off the agenda first — but if his public support doesn't recover in the meantime, his opponents may be tempted to force him out before the start of the autumn extraordinary session, election avoidance syndrome or no election avoidance syndrome.

In this post earlier this month, I discussed the importance of "pride" — hokori (誇り) — in the thinking of the Japanese right.

In this vein, Younghusband at Coming Anarchy writes of a dispute between the DPJ and The Economist over the recent cover that featured the pun "Japain."

Iwakuni Tetsundo, head of the DPJ's international bureau, wrote to complain about the cover:

...I strenuously object to the title on the cover of your Asia edition, 'Japain'. Japan is the official name of our nation, registered and acknowledged by the United Nations and other international bodies. It is completely outrageous that you combined the word for our nation with 'pain'. You made fun of our respected nation's name on a cover that is sold on newsstands all over the region. This conduct is equal to burning a national flag, which is base and inconsiderate. No nation's name should be treated like this.

I disapprove of the utter lack of humor on the part of Mr. Iwakuni, and, presumably, the DPJ, since Mr. Iwakuni seems to have written in an official capacity. Please take a deep breath: this is nothing like the burning of a national flag, and this stance makes the DPJ look silly and irrationally nativist.

This episode goes to show that a national pride that occasionally borders on chauvinism is not the unique property of the LDP and conservatives like Nakagawa Shoichi. This is a reality of Japanese politics today. I suspect Japanese politicians — and the Japanese people — may have a bit of a chip on their shoulder as a result of the slights and put downs the country endured during the lost decade. (Of course, the Japanese establishment engaged in ongoing self-criticism throughout the 1990s.) This suggests that nationalism and related-foreign policy issues will not be the basis for a new cleavage in a realigned political system. A certain degree of nationalism — if not loyalty to the nationalist agenda proposed by the LDP's conservatives — may be common to most Diet members.

This episode may also reflect a certain powerlessness on the part of the Japanese establishment, prompting officials and businessmen to lash out like this: it is difficult, after all, for Mr. Iwakuni to take issue with the substance of The Economist article, although he attempts to refute the magazine's criticism of the DPJ. Japan is mired in intractable social and economic problems that have diminished the country's international profile. As such, the DPJ and the establishment as a whole should not vent its frustrations at foreign critics, who for the most part have Japan's interests at heart.

Thursday, March 20, 2008

In the year since Funabashi Yoichi, editor-in-chief of the Asahi Shimbun, finished The Peninsula Question, the US and North Korea made an agreement that restarted the Six-Party talks, overcame the Banco Delta Asia obstacle, and issued a joint statement with the other parties that included a promise by North Korea to account for its nuclear program and disable related facilities, before progress stalled at New Year's. In the process, the Abe government ensured that Japan would not play a constructive role in the talks.

Dr. Funabashi's book does not suffer from leaving off at North Korea's nuclear test in October 2006. Indeed, The Peninsula Question anticipates much of what's happened over the past year.

The Peninsula Question is, according to its subtitle, "a chronicle of the second Korean nuclear crisis." This is not a polemic — Dr. Funabashi does not deviate from his measured tone except in a few spots in which he criticizes US hawks — and he provides few answers to the titular question. But as a chronicle of the Northeast Asian crisis since 2002, it is nonpareil. Dr. Funabashi interviewed dozens of policymakers in the governments of five of the six parties, providing an intimate look at how the US, Japan, China, South Korea, and Russia approached North Korea in the Six-Party talks.

The result is of interest to both general readers and international relations specialists, as Dr. Funabashi shows the constraints that impact foreign policy decision makers. Dr. Funabashi shows that neither international politics nor domestic politics is the primary constraint on policy makers: both are important, with some variance from country to country. Policy makers are also constrained by history, ideology, and geography. This is not to deny the role of human agency in policy making, but it suggests that policy makers operate exercise their agency within a narrow band. The main protagonists of Dr. Funabashi's book were further constrained because they were, for the most part, not heads of state and government. Perhaps the only figure willing and able to defy the constraints was former prime minister Koizumi Junichiro, who traveled twice to Pyongyang in pursuit of the normalization of diplomatic ties with North Korea.

As a result of his interviews, Dr. Funabashi draws special attention to the domestic constraints on each country's North Korea policy. While Washington and Tokyo were perhaps the most divided of the six parties, each government — North Korea included — had divisions that undermined the pursuit of an agreement. These domestic divisions resulted in first the rift between South Korea, and the US and Japan, and then in the rift between the US and Japan in 2007 as the Abe government took a firmer line on North Korea at the moment that the US approach softened.

Ultimately, though, it may be the international constraints that will undermine any agreement. North Korea, perhaps for good reason, believes that a nuclear weapon is the key to its security. Neither the US nor Japan is willing to live with a North Korean nuke; neither government, however, is in a position to take decisive action to end the North Korean nuclear program. China is clearly annoyed by North Korea, but appears willing to act only so far as to prevent a war on the Korean peninsula. Russia has little influence in Northeast Asia, as illustrated by Dr. Funabashi's chapter showing the failure of Russia's attempt to offer itself as an "honest broker" in the talks.

The result? North Korea will continue doing exactly what it's been doing. In the meantime, the five parties should be strengthening cooperation in preparation for the collapse of the DPRK, because post-DPRK North Korea may be the source of more trouble in the region than the DPRK itself, albeit trouble of a different sort.

From io9, Gawker Media's science fiction blog, comes a report that Russia will once again be parading ICBMs in Red Square on Victory Square.

This story brought to mind a moment from "Simpson Tide," an episode from the ninth season of The Simpsons:Russian official: The Soviet Union will be pleased to offer amnesty to your wayward vessel.American official: The Soviet Union? I thought you guys broke up.Russian official: Yes, that's what we wanted you to think! [laughs]

I'm back in New York City now and normal blogging will resume momentarily.

In the meantime, readers who will be in New York City area on Thursday, April 10 will be able to see me live at an event called "The Republic of Bloggers" at the Korea Society. The official announcement follows.

The Republic of Bloggers

Thursday, April 10, 2008

The Korea Society, 950 Third Avenue, Eighth Floor, New York City(Building entrance on SW corner of Third Avenue and 57th Street)6:00 PM-6:30 PM ♦ Registration and Reception6:30 PM-8:00 PM ♦ Presentation and Q&A$10 for members (The Korea Society, Japan Society or Carnegie Council). $15 for non-members.Buy tickets

For more information or to register for the program, contact Patrick Clair at (212) 759-7525, ext. 328 or email

With some of the highest rates of broadband and wireless Internet penetration in the world, Korea and Japan are home to thriving online communities that affect politics, shape public opinion, and forge new forms of social bonding. In Korea, the net has empowered citizen journalism and created a new national pastime of “massively multiplayer online games.” According to the Washington Post, more blogs are written in Japanese than in English, despite the fact that English speakers outnumber Japanese speakers by five to one. Both countries are bastions of participatory Internet use, but what accounts for subtle differences in user attitudes and behavior? In addition to exploring the challenges and lessons learned by people blogging about Korean and Japanese society and politics, the panel discusses how the peculiarities of Japanese and Korean political and online cultures affect participatory democracy in those countries, and whether these experiences will be a bellwether for the global community.

Tuesday, March 18, 2008

As MTC points out, the LDP did the exact same thing in introducing the nomination of Tanami Koji as it did with the nomination of Muto Toshiro: it failed to consult with the DPJ beforehand.

Indeed, showing that it has learned absolutely nothing and suggesting that the government is in fact not above playing politics, it submitted, in the words of Hatoyama Yukio, DPJ secretary-general, a man with the "same career history as Mr. Muto."

Little wonder that the DPJ has rejected this latest, feeble effort to avoid a vacancy in the leadership of the BOJ.

While the DPJ has once again stated that the reason for the rejection is fears about the independence of the BOJ from the Ministry of Finance, this fight is not about central bank independence. It is about the LDP's persistent inability to come to terms with the idea that the Diet is divided and that it needs to consult with the DPJ beforehand, especially in cases like this in which it has no recourse to the Article 59 override used in the MSDF refueling mission case.

Heading into the midst of the worst economic conditions since World War II without a central banker may be harrowing, but maybe it will be the only way the government will learn that treating the opposition with condescension doesn't work when the opposition has a major stake in the policymaking process. For all the complaints about DPJ intransigence, the government bears much of the blame for a failure to find a way to compete short of mutually assured destruction or cooperate short of a grand coalition.

The big news of the day is, of course, the government's decision to submit a new candidate for the BOJ governorship in place of Muto Toshiro. It is still unclear who the government will submit in his place — the LDP is reportedly sounding out the plausibility of Mr. Fukui's staying in office, although the DPJ has nixed it. But a compromise is likely to emerge any day now.

So who won, who lost?

Obviously the biggest loser is Muto Toshiro, who was rejected for the scantiest of reasons, guilt by association with the Ministry of Finance. Then again, with the Bear Stearns blowout and its likely ramifications, maybe he's the biggest winner of all, given that he won't have to the helm of the BOJ in the midst of a rapidly worsening global financial crisis.

Did the government and the LDP win or lose? Politically, the LDP lost, simply because it conceded. But by conceding, the government can spin its concession as an illustration of its willingness to compromise with the opposition and its desire to put the national interest before political opportunism.

As for the DPJ, in simple political terms, the DPJ won. It forced the government to withdraw Mr. Muto, and showed that it will not be ignored by the LDP, especially on appointments.

But it is necessary to look at the winners and losers within the DPJ. This is not a victory for Mr. Ozawa, who found as the BOJ fight intensified that his hands were tied by hardline Muto opponents who are also opponents to Mr. Ozawa's leadership. The anti-Ozawa group will likely emerge from this fight emboldened, more confident in its ability to pressure Mr. Ozawa to bend to their wishes — and more prepared to unite behind a candidate to oppose Mr. Ozawa in the September leadership election.

After nearly returning to the LDP in the waning days of the Abe cabinet, Hiranuma Takeo, holdout postal rebel and conservative stalwart, is not particularly popular among the LDP's elders.

Recall, for example, that in January Mori Yoshiro scolded Nakagawa Shoichi for working with Mr. Hiranuma in their "True Conservative Policy Research Group," AKA the HANA no Kai. Undoubtedly Mr. Hiranuma's presence outside the party is noxious to LDP leaders like Mr. Mori eager to keep their divided party together, not least when he speaks of creating a new "true" conservative party.

In a move that will likely irritate the party elders, Mr. Hiranuma has endorsed Aso Taro for LDP leader. He said Friday, "If the Fukuda cabinet resigns en masse, everybody is looking to the birth of an Aso administration. Since my principles and opinions are very similar, I will work hard to realize it."

I don't see how Mr. Hiranuma's endorsement helps Mr. Aso, particularly since the latter is trying to make a case for why he is the best man to reunite the LDP in the post-Fukuda era, which may be coming sooner than anticipated (and may therefore begin before the next general election). Indeed, despite Mr. Aso's fervent courtship of Mr. Mori and other Machimura faction power brokers, I wonder whether his association with Mr. Hiranuma — and comments made during last September's presidential election about factional politics — will once again deny him the LDP presidency, a scenario that leads me to wonder what Mr. Aso, Mr. Hiranuma, and the other conservatives will do in response.

Thursday, March 13, 2008

With the end of Fukui Toshihiko's term as BOJ president rapidly approaching, there are signs that the LDP and the DPJ might be able to come to terms on the nomination of his successor.

Messrs. Oshima and Yamaoka, Diet strategists for the LDP and DPJ respectively, met once more on Thursday and agreed that a vacancy at the BOJ is undesirable. The two reportedly discussed an idea, emerging from within the LDP, to revise the BOJ law to allow for a temporary extension of the BOJ president's term. There is also the possibility that Shirakawa Masaaki, a Kyoto university professor already confirmed by both houses as vice president, could serve as acting president until the parties agree on a BOJ president.

In the meantime, the LDP has announced that it will wait until Monday to submit Mr. Muto's nomination once again, giving the parties time to pursue a compromise while ensuring that the BOJ presidency will not be vacant. Sankei suggests that there are signs that the LDP might be willing to reconsider its support for Mr. Muto.

On the gasoline tax front, Mr. Fukuda alluded to the possibility of a compromise in deliberations at the HC Budget Committee Thursday, although he provided to details on what a compromise might entail. Ota Akihiro, Komeito head, suggested that the compromise could entail shortening and trimming the 10-year, 59 trillion yen road-construction plan, directing more gasoline tax revenue to the general fund, and putting a shorter time limit on the temporary tax. Koishi Azuma, the head of the DPJ group in the HC, dismissed Mr. Ota's suggestions off hand.

Compromise on this issue has proved elusive even among the LDP's and DPJ's young reformers, who agree on so much else. At a debate on Thursday, each party's Young Turks repeated the party line: LDP members emphasized the importance of road construction for rural areas, DPJ members emphasized the importance of redirecting road construction funds into areas that have even more importance for the lives of Japanese citizens. The DPJ reasons — not inappropriately, I think — that it stands to gain from letting the gasoline tax lapse, at least for the month until the HR can automatically pass it again. Local governments will be unhappy with the DPJ, of course, but then with so many local governments in LDP hands, should the DPJ be bothered by their criticism? What matters is how voters will respond, and I find it hard to believe that they will be too irate about a tax break.

Koizumi Junichiro has used the stalemate to continue raising his political profile. The former prime minister, speaking in Hamamatsu on Thursday, appealed to the leaders of both the LDP and the DPJ to compromise for the good of the nation. Will Koizumi power be enough to break the deadlock? I'm skeptical.

Many analysts of Japanese politics assumed at the inception of the Fukuda cabinet that his was little more than a caretaker government.

Now more than 100 days into the Fukuda administration, it remains difficult to say whether that assessment will turn out to be accurate. If the caretaker's job is to stabilize the ruling party and ensure that his successor's government will have surer footing, then Mr. Fukuda is an abject failure as a caretaker.

That would explain the intra-party maneuvering described in a long, rambling article by Akasaka Taro in the April issue of Bungei Shunjyu, posted in twoparts at Yahoo! Minna no seiji.

The first part describes Mr. Fukuda's efforts to bolster his government's ability to lead on social security and taxation — Akasaka opens with the example of the recent appointment of Ito Tatsuya, a lieutenant of Nakagawa Hidenao as the prime minister's adviser on the social security issue in defiance of the health and welfare "tribe" to show the treacherous waters in which Mr. Fukuda is navigating.

The Fukuda government, Akasaka suggests, has been paralyzed in terms of its policy leadership, for reasons having more to do with Mr. Fukuda's struggle to impose some discipline on party and bureaucracy than with the divided Diet. At the same time, however, he may be laying the groundwork for a Fukuda-"colored" policy agenda that will enable him to serve as something more than a caretaker:

"The Social Security People's Conference." "The Conference for The Promotion of Consumer Administration." "The Global Warming Problem Consultative Group." These are all Fukuda ideas. In these three big policy areas a Fukuda color is becoming clear, sweeping away the "no policy" criticism and marking the start of the search for Kantei-led policymaking.

On this basis, Mr. Fukuda will attempt to prolong his government and delay a general election.

The second half of the article, however, suggests that reformist opponents of Mr. Fukuda may already be laying the groundwork for a new cabinet.

Akasaka points in particular to the activities of Sonoda Hiroyuki, a seven-term HR member who left the LDP in 1993 to join Sakigake before returning to the LDP in late 1999. He suggests that Mr. Sonoda is plotting with certain DPJ members to create an emergency government under the leadership of Yosano Kaoru. Supposedly Mr. Sonoda is working, through Sentaku, with anti-Ozawa members of the DPJ to undercut both Mr. Fukuda and Mr. Ozawa and vault a reformist government to power that will deal with Japan's most urgent problems. Mr. Yosano would be the man for the job apparently on the basis of his having been acknowledged as Mr. Koizumi's truest heir by longtime Koizumi aide Iijima Isao.

Whether there is something to this Sonoda "conspiracy" is besides the point. What's important is what this means for dynamics within the LDP: Akasaka acknowledges that the next LDP leadership struggle will likely be between Aso Taro and his conservative allies led by Nakagawa Shoichi, and the group of reformers around Yosano and centered in the reborn Kochikai, with outside help from Komeito and the DPJ. The decisive factor will be the backing of the Machimura faction.

For the moment, Mr. Fukuda — who vaulted to the premiership thanks to the backing of the Machimura faction, or rather Mori Yoshiro, its capo — enjoys the support of the LDP's largest faction. There is the possibility, however, that Mr. Mori and his lieutenants, the most vocal advocates of postponing a general election until September 2009, will begin looking for a more popular alternative to Mr. Fukuda later this year in the hope of repairing the LDP's prospects in the year leading up to a general election. It is possible that pressure for Mr. Fukuda to step aside in the aftermath of the G8 summit could come from his own "backers."

As for the prospects of the "Yosano emergency government," I think any plan that rests on the support of the DPJ's anti-Ozawa group is an unreliable one, not least because for the moment I think they would prefer to focus their efforts on unseating Mr. Ozawa from within the party — in September's party election for example — than in pressuring the DPJ from outside. That could change if and when someone triggers a realignment, as the Yosano camp could be the germ of a Koizumian new party, but for the moment this is just another example of the fevered speculation prompted by the uncertain political situation.

Finally, as for Mr. Fukuda, he remains, for now, the head of a woefully divided party that could splinter at any moment. Uneasy lies the head that wears the crown.

Janne Morén's recent post on institutional loyalty (thanks for the reminder, MTC) provides an excellent argument for why to anticipate a new political realignment in the near future.

He writes:

If we return to politics, the situation shares some similarities and there is a clear possibility of a similar dissolution of loyalty between lawmakers and their parties. More and more of pre- and post-election resources are tied to the politician personally, and come from sources other than their party. A party of course offers their name - political branding - and a party affiliation is often necessary to partake in the give-and-take of parliamentary work (you need party support for juicy positions, just like you need a research affiliate for grants), but again, there is no real reason to stay with one particular party at any cost. The more an election costs the less beholden is the candidate. A veteran lawmaker (or dynastic scion) comes with his own district-wide name recognition, his well-tested local organization and a stable cadre of financial donors (legal or not; improper political donations are a leading cause of indictments here). An established politician may in fact need his party quite a bit less than the party needs him.

Lawmakers do shop around in Japanese politics; a not inconsiderate number of lawmakers have switched parties, sometimes several times, during their careers. And you can argue that the same mechanism is at play among internal party factions in the LDP, with individuals changing their allegiance in return for a cabinet post or committee membership. This, by the way, happens very rarely in Sweden, as most election costs are borne by the parties, not the representative. As internal cohesion weakens and parties become little more than amorphous blobs discussion clubs for mutual backing (the ideological range within both the LDP and DPJ almost beggars belief), the next step would be to dispense with party affiliation as a major criteria for case by case cooperation altogether.

And that, ladies and gentlemen, is why a political realignment is pretty near inevitable.

The LDP, and Japanese political parties in general, have never been known for their cohesiveness. Indeed, a longtime foreign correspondent once quipped to me about the LDP, "The party may be known as the Jiminto (自民党), but each member is his own Jibunto (自分党)." The prevalence of koenkai and hereditary Diet members in the postwar period meant that financial independence was common for LDP members; they depended upon the party for jobs and for pork.

What binds members to their parties today? The most important factor, at least for lesser-known members, may be the party's endorsement to run as a candidate (the "branding" factor). It certainly isn't policy: policy loyalty seems directed more at sub-party groups — factions or study groups — than the party at large.

That said, I do not think that party affiliation is on the road to irrelevancy. The situation described by Mr. Morén simply shows the failure of the current political arrangement. The LDP and the DPJ are fundamentally incoherent, divided as much or more within as between the parties. This fact is universally recognized, at least in the Japanese political world. Few doubt that a realignment is necessary. The question now is how the realignment will unfold: who will make the first move? What issue(s) will form the basis for the identities of the new parties? Taxation? Deregulation? The welfare system? Foreign policy?

Of course, the new (or newly transformed) parties will be divided in different ways — and members will still be financially independent from the party leadership. But they will likely inspire greater loyalty from their members than the current LDP and DPJ.

Wednesday, March 12, 2008

The fight between the LDP-Komeito governing coalition and the DPJ over the leadership of the Bank of Japan shows no sign of abating.

On Wednesday, of course, the DPJ-led House of Councillors formally rejected the government's nomination of Muto Toshiro to be the new president of the BOJ. The government has resubmitted Mr. Muto's nomination in response. In his daily press conference Wednesday, Chief Cabinet Secretary Machimura Nobutaka professed an inability to understand the DPJ's reasoning and once again highlighted the urgency of a smooth transition to a new BOJ president given prevailing financial conditions.

I must agree with MTC: the DPJ does not bear the blame for this "crisis" alone. For all of Mr. Fukuda's willingness to cooperate with the opposition, his party and his government have failed to come to terms with new masters of the Upper House. They have refused to accept that they actually have to consult with the DPJ, instead of presenting them with proposals as faits accompli (as they did in the case of Mr. Muto). Not surprisingly, Kitagawa Kazuo, Komeito secretary-general, used this occasion to complain about the constitutional defect of the HC's role in personnel appointments, illustrating the disdain with which the government still views the opposition's control of the HC.

If the government is so concerned about a vacancy at the bank, it should have been both (a) making the case for Mr. Muto persistently and loudly starting months ago and (b) exploring alternatives with the DPJ. The LDP is always talking about urgent national problems and yet now, when faced with one, it seems that the government has no plan B. It's Muto or nothing. Is there really only one man qualified to serve as BOJ president? If so, Japan must be in even worse shape than I thought.

So the HR will pass the Muto nomination again this afternoon, daring the HC to once again reject it. If it does, will the government nominate Mr. Muto a third time? And will the DPJ suffer political consequences as a result of holding fast in its opposition to Mr. Muto?

Tuesday, March 11, 2008

It appears that the administrative reform package desired by Watanabe Yoshimi, minister responsible for administrate reform, will be watered down as expected. Given the reception Mr. Watanabe's proposals received in the cabinet, I can't say that I'm surprised.

According to Mainichi, the powers of the Cabinet Personnel Agency, the central feature of Mr. Watanabe's plan, will be diluted, with responsibility for the CPA given to the chief cabinet secretary and individual cabinet ministers retaining the right to manage personnel affairs in their ministries.

Thanks to the intervention of Prime Minister Fukuda, the objections of cabinet minister were acknowledged and the draft was moderated accordingly.

Now that LDP has delivered a disappointing result, will the DPJ finally take up this issue and pressure the government on its coddling of the bureaucracy?

I couldn't resist linking to this item at Foreign Policy's Passport, which notes that Australia's navy is struggling for recruits.

Why?

It can't compete with Western Australian mining companies that are expanding operations to take advantage of growing Chinese demand (and accordingly, rising prices) for commodities.

This may be the single best illustration of why the simplistic, "arc of democracies" model of dealing with China favored by former prime minister Abe Shinzo and some conservatives in Washington is wholly inappropriate for Asia in the twenty-first century.

With the fight over the nomination of Muto Toshiro taking center stage, opposition calls for Defense Minister Ishiba Shigeru to resign due to the Atago incident appear to have receded, leaving Mr. Ishiba to proceed with his efforts to clean up the Defense Ministry.

The latest piece of that effort is his project team to "promote integrated procurement reform." This group's purpose is radical change in the defense procurement process with the aim of eliminating the pernicious influence of the defense trading companies, which results in untold waste and inefficiency in Japanese defense spending. Last year's scandal implicating Moriya Takemasa provided a mere glimpse at the problem.

Asahi reports that the team's final report, due at the end of the month, will make several changes to defense procurement effective at the start of Fiscal Year 2009, including the creation of a supervisory group that will monitor the activities of trading companies in relation to arms imports and the expansion of direct links to defense contractors in the US (for example).

Any Japanese politician who claims to be serious about national security should be wholly supportive of Mr. Ishiba's efforts at the very least, and should be clamoring for more assiduous oversight from the Diet and ideally an intra-ministerial inspector general. The combination of a changing security environment and tightening budgets mean that the Japanese people and their elected representatives should not tolerate the gross misuse of public funds that is the result of the trading company-dependent procurement process. They should demand transparency, efficiency, and accountable, considering national defense is at stake.

Monday, March 10, 2008

Aso Taro, looking hungrily to his next bid for the LDP presidency, has continued his campaign to remake his image with an article in Voice in which he discusses the need for a radical reorganization of how Japan is governed, including both a consolidation of prefectures into larger "states" and a transfer of authority, including tax authority, to the regional governments. In case anyone needs a reminder of why this argument is important, The Economist has an article about the dependence of prefectures and localities on Tokyo here.

Not surprisingly for a contemporary Japanese politician considering radical changes to Japanese governance, Mr. Aso appeals to the Meiji Restoration, pointing to the effectiveness of the centralized system built by Meiji elites — and sustained by postwar elites — in first fending off the European empires and then promoting the rapid development of postwar Japan, making Japan, he argued, into what may have been the world's most efficient and equal society.

Facing the reality of faltering regions, however, Mr. Aso recognizes that drastic changes are needed to revitalize Japan; the central government is not up to the task:

In order to stop centralized rule, a drastic transfer of work on the domestic affairs side to the states is necessary. That is, public utilities, industrial development, and social welfare. Also, so that we can think for ourselves and work for ourselves, taxes must also be handed over...The central government will become much smaller scale, specializing in foreign affairs and the administration of justice — the work of thinking about Japan in the world.

The goal is to enable local and regional governments to undertake whatever measures they think will best promote the rejuvenation of their jurisdictions, i.e. the states will be the laboratories of Japan's recovery (and perhaps even democracy).

Meanwhile, in Tokyo the rump central government will be, in Mr. Aso's words, "small but strong."

As a federalist, I find much of value in this proposal. The central government has failed, again and again, for the past two decades (or more). The LDP has enabled and exacerbated these failures. Piecemeal measures have not been enough to correct these failures, and the bureaucracy remains opaque and all-too-unaccountable. Regional governments under Mr. Aso's system could have the same problems as the central government has had, but the hope is that by being closer to the people, they will be more accountable.

Incidentally, I imagine that Mr. Aso's conservative colleagues find some value in this new system, seeing as how it would allow them to continue to be blind to Japan's social and economic problems and focus exclusively on the question of Japan's place in the world. At the same time, this plan is a non-starter within the LDP, just as even modest decentralization faces fierce opposition within the party. I expect that even within the LDP's prefectural chapters this plan would draw opposition — look at how LDP members from prefectural assemblies rushed to Tokyo to show their support for the continuation of the special road construction fund.

For a politician bent on taking control of the LDP, Mr. Aso has opted for an unusual path to power.

Sunday, March 9, 2008

If Nakagawa Shoichi, leading conservative, has a virtue, it is his refreshing candor. Back when he was serving as head of the LDP's Policy Affairs Research Council under Mr. Abe, I suggested that Mr. Nakagawa was Mr. Abe's id, saying things that would be improper for the prime minister to say himself.

Appearing on Fuji Television's Hodo 2001 program on Sunday, Mr. Nakagawa said in reference to the hounding of Japanese whaling ships by a ship operated by the non-profit group Sea Shepherd in the Antarctic Ocean, "They have wounded Japanese. If the Coast Guard were to arrive, they should not just fire warning shots, they should 'use force.'" Asked whether he was suggesting that the Sea Shepherd should be sunk, he replied, "Of course."

I think this provides a glimpse into the mindset of the conservative ideologues. Mr. Nakagawa suggests that a violent response is merited because "Japanese were hurt." I wonder, however, if what was hurt was not Japanese citizens but Japanese pride. I get the sense that Mr. Nakagawa is brimming with anger that these foreign activists were able to get away with these actions, which have been condemned by the IWC. And so Japan needs a new defense posture and more assertive foreign policy: Japan must never allow itself to be powerless in the face of foreign aggression, whether in the form of North Korea's abductions of Japanese citizens or Sea Shepherd's harrying of Japanese whalers. The harm to Japanese citizens is, I think, secondary; what matters is the harm to Japan's pride. The result is a burning anger directed both at foreign transgressors and at the institutions and individuals within Japan responsible (MOFA, etc.) for failing to uphold the nation's pride.

As MTC noted recently, pride — hokori (誇り) — is a favorite word of the Japanese right. It is impossible to understand the foreign and defense policies advocated by the right without appreciating this concept. Beyond the superstructural justifications for a more assertive Japan (the arc of freedom and democracy, etc.), the conservatives are desperate to be proud again, to meet every perceived offense with resolution. Postwar Japan to them has been one abdication after the other, and hence the postwar "regime" must be left behind.

Following the government's formal nomination of Muto Toshiro for the post of BOJ president on Friday, the LDP launched a war of words over the weekend to paint the DPJ as irresponsible and pressure it to accept Mr. Muto to prevent a vacancy at the BOJ.

On Saturday, Tanigaki Sadakazu, LDP policy chief and former finance minister, criticized the DPJ's argument that a former MOF bureaucrat is unfit for the BOJ presidency by stating that there are many examples of European central bank presidents who came out of finance ministries.

Ibuki Bunmei, LDP secretary-general, took a different approach on Saturday. Speaking in Sapporo, he trotted out the well-worn line cautioning the DPJ about "misusing" its power: "The DPJ obtained the power of the majority in last summer's Upper House election. It is now being tested whether it will be an 'upstart in power' or whether it will use its power correctly on behalf of the nation. We hope that from the start of the week they will not abuse their power and will solemnly choose to exercise good sense."

Mr. Ibuki also appeared on NHK on Sunday to declare that Mr. Fukuda has rejected the DPJ's offer of face-to-face talks in exchange for the government's nominating another candidate in place of Mr. Muto.

Ota Akihiro, head of Komeito, has also criticized the DPJ for its inflexibility.

The DPJ has responded blow for blow. On Saturday, Hatoyama Yukio, the DPJ secretary-general, criticized Mr. Muto's appointment as an "amakudari appointment," and made the offer that was subsequently rejected by Mr. Bunmei. Kan Naoto, the DPJ's acting president, emphasized on NHK Sunday that the DPJ's position is unchanged — there will be no compromise on Mr. Muto.

It is possible to overstate the importance of a vacancy at the Bank of Japan. Both politicians and commentators have assumed that because of the global financial situation, a vacancy at the Bank of Japan would be a disaster. I don't quite buy this argument. As Wolfgang Munchau argues in the FT, "For as long as this financial crisis persists, interest rates will be determined by toxic market conditions, not central bankers. Among the various channels through which monetary policy affects the real economy, the credit channel is one of the most important. If real-world interest rates are determined independent of a central bank’s monetary policy, the effect of monetary policy on economic growth is correspondingly reduced."

Of course, Munchau does not argue that central banks are totally irrelevant — nor do I — but the practical impact of a failure to nominate a new BOJ chief by March 19 is not particularly great. Even the symbolic impact of a BOJ vacancy on the markets may be overstated: there are other, more enduring factors determining the flow of money in and out of Japan at the moment.

As the weekend's rhetoric makes clear, this battle is a preview of a general election campaign. Both the LDP and the DPJ have imposed their "narratives" on this issue. Can you really trust the DPJ with the government, the LDP asks. Look at the LDP, the DPJ says. In bed with the bureaucrats. Not much room for a compromise here, particularly because each side has escalated, much like in the fight over the MSDF refueling mission. In particular, there is no easy way for the DPJ leadership to back down, because Mr. Ozawa's fiercest opponents within the DPJ are also the fiercest opponents of the Muto nomination.

Friday, March 7, 2008

The signs of change in the DPJ's thinking on the timing of the next general election discussed here is now a definite policy shift.

As Mr. Ozawa told reporters in Kyoto Thursday, "We are struggling on the major premise of a dissolution this Diet session, although since the right to dissolve the Diet is held by the Cabinet, we don't know [what will happen]."

Mr. Ozawa might be encouraged by the findings of a recent Mainichi poll that shows that 44% continue to hope for a DPJ general election victory, compared with only 34% who want the LDP to win. (Interestingly, the poll also recorded a ten-point increase, to 15%, of respondents who want "another party" to win.)

Perhaps there is hope for Mr. Ozawa and the DPJ yet, although I remain convinced that the next general election will trigger a series of events likely to impact both parties profoundly, making it next to impossible to predict the post-election landscape.

And regardless, since the DPJ will not be fielding candidates in approximately fifty single-member districts, it is highly unlikely that it will win outright.

I have learned that Ozawa Ichiro reportedly dispatched a DPJ member to observe Barack Obama's presidential campaign in Texas in advance of Tuesday's voting.

He could have saved some money and looked closer to home at the politics of former prime minister Koizumi Junichiro.

There are a few obvious superficial similarities — and a few equally obvious differences. In the former category, the two share certain rhetorical gifts, a "hipness" that enables them to appeal to younger voters (not surprisingly, Rolling Stone has endorsed Mr. Obama), and a sense of being propelled to leadership thanks to the "fierce urgency of now" despite relatively lackluster or short political careers. Perhaps the biggest difference between them is the conditions they face: although Mr. Koizumi has been rightly criticized for the simplicity of his slogans, kaikaku meant something. The Koizumi revolution, while incomplete, was still a revolution, with the LDP's facing its full consequences today. By contrast, while Mr. Obama speaks often of "change," it is still not clear what that will mean in practical terms — and as David Brooks argues in the New York Times, his message of standing for a new kind of politics might not even survive the fight for the Democratic nomination.

But there is something more to the superficial similarities, which may not be so superficial after all. In the massive crowds that greeted Mr. Koizumi at his campaign appearances and the record-breaking crowds who have greeted Mr. Obama in even the most unlikely of places, one sees how both men are capable of tapping into the most visceral hopes of Japanese and American voters. Despite widespread cynicism about the political process in all mature democracies, both politicians make clear that voters are still willing to believe that things can be better, that it is still possible for a more hopeful, responsive politics that addresses the fears and ambitions of the people — and the politician that can tap into that reservoir of hope is a powerful politician indeed. (And, of course, there is always the danger that such politicians will abuse their power, with disastrous consequences that do not bear mentioning because I wish to respect Godwin's law.) There is, of course, a strong likelihood that voters will end up disappointed; Japanese voters were certainly frustrated by Mr. Koizumi's failings. But no matter how many times they are disappointed, they continue to hope for leaders who promise to deliver change that results in a kinder, gentler politics. Hence Mr. Koizumi's resounding victory in 2005, despite the disappointments of the previous four years. Hence the strong approval ratings that greeted both Mr. Abe and Mr. Fukuda to office.

This, then, is the challenge for the DPJ. How can the party tap into the lingering hopes of Japanese voters? There appears to be no messenger on the horizon capable of elevating the DPJ's somewhat muddled message into a transcendent message of hope. The DPJ does not necessarily need a Koizumi of its own — indeed, Mr. Koizumi's aggressive, crisis-driven (dare I say Schmittian) politics were probably better suited for waging intra-LDP battles than for addressing the country's problems — but it does need a leader who can inspire the hopes of Japanese citizens and earn their trust, in the process enabling the DPJ to ask for sacrifices in interests of building new institutions and undertaking necessary and wrenching reforms.

As for Mr. Obama, I hope that he eventually turns from scapegoating trade agreements (and by extension, foreigners) and starts emphasizing structural reforms needed in the US to enable Americans to compete in a post-industrial, globalized economy.

In a transparent attempt to shift the blame for the Bank of Japan "crisis" from the government to the DPJ, today the Fukuda Cabinet officially submitted its nomination of Muto Toshiro to be the next BOJ president. If a Mr. Muto or another candidate is not confirmed within the next twelve days, the post will be vacant.

Without the agreement of the DPJ-controlled HC, any nomination is a non-starter.

The Fukuda government seems increasingly desperate to see this battle concluded in its favor, and to that end is pursuing two strategies simultaneously. One strategy calls for Mr. Fukuda to discuss the issue with Mr. Ozawa in the hopes of reaching an agreement. Yamaoka Kenji, Ozawa loyalist and DPJ Diet strategist, nixed this idea completely on behalf of Mr. Ozawa, suggesting that the DPJ will consider Mr. Muto's nomination itself and then answer the government. The other strategy is, of course, what the government did today: nominating Mr. Muto in an attempt to place the burden for a vacancy on the DPJ.

According to Mainichi, the DPJ recognizes that the government's move has put it in a tough position, as the party neither wants to bear the blame for a vacancy nor roll over for the government. We may be reaching the point at which the DPJ's latest wave of momentum dissipates — a point made by Jun Okumura here. Although the DPJ has indicated that it will not consent to Mr. Muto's nomination, the possibility of an about-face remains.

It will ultimately depend on Mr. Ozawa's read of the political situation. If Mr. Ozawa reckons that the domestic political consequences of opposing the government's nomination are slight, the DPJ will without question say "damn the markets" and reject the nomination. If he concludes that obstructing Mr. Muto's elevation to the BOJ presidency will play into the LDP's efforts to construct a general election narrative that paints the DPJ as little more than a noisy rabble unfit for government, the DPJ may step back from the brink of obstruction, make some show of having vetted Mr. Muto and declared him not tainted by his MOF past, and move on to the next issue. Doing so would entail not just a defeat for the DPJ, but also move the DPJ closer to an open fight over the leadership of the party, as anti-Ozawa DPJ members — some of whom have been leading critics of Mr. Muto's nomination on the basis of his MOF past and concerns for BOJ independence — may react by taking their desire to see Mr. Ozawa unseated in the September party leadership election out into the open.

This situation is typical of the DPJ's strategy since winning the HC election. Faced with what appears to be an opportunity to undermine the government, the DPJ throws all of its energy into exploiting it, only to overextend itself and leave itself vulnerable to public backlash and charges of fecklessness from the government.

A large segment of the public may be ready to vote against the LDP in a general election, but I reckon an even greater segment of the public wants the government and the Diet to work on their behalf.

Regardless of the resolution of this "crisis" — I use the quotation marks because aside from a slight shudder in the market, the world will not end if there is a vacancy at the BOJ — one thing is certain: it will prompt a new wave of articles in the foreign press lamenting the consequences of Japan's supposedly byzantine politics.

Thursday, March 6, 2008

Former Prime Minister Abe Shinzo has been back in the headlines this week, first for his return to the Machimura faction, which he left when he became prime minister, second for the announcement that he will chair an LDP study group related to the implementation of his "Cool Earth 50" initiative. The latter prompted Asahi to ask whether this is the beginning of Mr. Abe's "re-challenge," referring to another of Mr. Abe's initiatives.

Mr. Abe's return to the Machimura faction makes him its sixtieth member from the House of Representatives.

I find the former of greater interest than the latter, because the Machimura faction increasingly appears to be a microcosm of the party at large.

Consider that the faction contains a moderate dove like Prime Minister Fukuda, risk-averse senior politicians like Mori Yoshiro, Nakagawa Hidenao, and Machimura Nobutaka, "true" conservative Abe Shinzo, and a healthy cohort (27) of first- and second-term members of the House of Representatives, many of them Koizumi Kids. With the Machimura faction having made the Kantei its private property over the course of this decade, its complexion matters considerably in the future of LDP governance.

The selection of Mr. Fukuda as prime minister, thanks in large part due to his own faction's support, illustrates this point — and illustrates that the party is, for the moment, in the hands of the cautious, reactionary Mr. Mori.

Will Mr. Abe's return make a difference? I suspect not. The very idea of an Abe comeback strikes me as laughable, and I expect that few of his conservative allies long for his return. (At least one of them doesn't.)

The next LDP presidential election, meanwhile, will likely test the Machimura faction's power. If it comes after the next general election — as I expect it will — it may find its numerical clout diminished somewhat as some of its one- and two-term members in vulnerable urban and suburban districts go down to defeat. The test will likely come from Nakagawa Shoichi's "True Conservative Policy Research Group" [The HANA group], or at least the movement symbolized by the HANA group. Unless the Machimura faction decides to take a chance on Mr. Aso this time around, which would defuse the situation, the next LDP election will ask certain LDP members to choose between their values and their faction, and perhaps ultimately, their values and their party. This dynamic was present in the September election, as evidenced by the subterranean support for Mr. Aso — and the formalization of a conservative anti-mainstream in the form of the HANA group only exacerbates the tension.

Mr. Abe will be no less immune to this dilemma than his less prominent colleagues. Indeed, his return, according to Mainichi, is the result of Mr. Mori's anger at Mr. Nakagawa's group. As noted previously, one of the first steps in Mr. Abe's political rehabilitation was his joining the HANA group last month. Writes Mainichi: "Mr. Mori, who frowned at this, urged Mr. Abe to return to the faction."

Mr. Abe will be serving as a counselor to the faction, a position offered perhaps in part to cement his loyalty.

At The Current, the latest addition to The Atlantic's blog empire (Hey, need a Japanese politics blog? Ed. — Riiiiight), James Gibney has a short post about the Tyrone Hadnott case and its consequences, which, not surprisingly, has sparked heated discussion in the comments section and prompted Marc Danziger at Winds of Change to cancel his Atlantic subscription.

Aside from a problem with indelicate phrasing — Danziger is right to complain about the phrase "...the overwhelming majority of U.S. military personnel aren't sociopaths" — Gibney's post more or less misses the point.

"But the impact of these kinds of episodes on the U.S. image," he writes, "not to mention on our strategic relationships, is one more reason to weigh carefully the hypothetical benefits of a long-term U.S. military presence against their very real costs."

The problem is simple. The USMC presence in Okinawa essentially constitutes a full American city (or town) transplanted to southern Okinawa. The scale of the US presence means that Americans, both Marines and their dependents, constitute a working community within a community in a way that smaller Navy, Air Force, and Army facilities on the mainland do not — and the heavy concentration of 18-25 males ensures a higher crime rate than might otherwise be expected. The scale of the US presence in Okinawa means that there is necessarily less need for contact on the individual level with locals on a daily basis. Arguably US Navy, Army, and Air Force bases on the mainland do not have the same problems due to the differing size and composition of those communities; they have little choice but to act as full members of the community that host them (I've seen this in Yokosuka, for example) and their service personnel tend to be older and better-educated.

In short, this is a structural problem that can be managed but not eliminated. Even a full lock down at US bases in Okinawa was insufficient in preventing criminal activity.

The best way to manage the problem is, therefore, to make it go away, at least in part. The US government and military have concluded this and enshrined it in an agreement with the Japanese government. The US has acknowledged the problem, recognized the burden that the Okinawan people have carried for decades, and concluded that the US forward presence must be changed — and as a result, by 2014 some 8,000 Marines and an even greater number of dependents are supposed to leave for Guam, with the vacated bases in the heavily populated southern portion of Okinawa's main island subsequently reverting to Japanese control and remaining USMC elements relocating to the less densely populated northern part of the island.

The question, therefore, is not whether, but when and how. The US government prefers to wait while Tokyo ponies up the money for construction on Guam and secures the approval of every local government affected by realignment.

I would, however, prefer it happen faster, because every incident carries the risk of being the incident that tips the balance against the US forward presence, forcing the US to remove air and naval assets in short order and permanently scarring the alliance (if not breaking it entirely). And waiting for Tokyo could mean waiting a long time.

Wednesday, March 5, 2008

As the natural culmination of the shift in momentum that has the DPJ pressuring the government on all fronts and feeling confident enough to boycott HC deliberations to protest the government's passage of the FY 2008 budget last week, the DPJ is once again preparing for an early general election.

Speaking to reporters in Hamamatsu, Ozawa Ichiro said, "Anticipating that there might well be a dissolution of the House of Representatives and general election during the current Diet, we are hastening the backing of candidates."

He also emphasized the issues that contributed to the DPJ's win in last summer's HC election: "The life of the people is the thing [the central issue in the general election campaign]. It is understood that the mistake of 'market economy omnipotentism' is growing inequality."

I still think that an early election favors the LDP, even if some of the party's elders — Mr. Mori, for example — think otherwise: for all that Mr. Fukuda's popularity has fallen, he remains more popular than Mr. Ozawa, and the DPJ clearly needs more time for its candidates to make themselves known to voters. So with that in mind, a pre-G8 general election remains plausible, if not highly probable.